The energy explorer in the country must be jumping with joy as of now as the companies will now get tax incentives which will be based on the investments. The gains will come into effect in the ninth round of auctions for oil and gas exploration blocks and will be replacing the existing regime of seven-year tax holiday on profits.

According to the recently made announcement by the petroleum and gas minster, Murli Deora, the tax benefits will extend to gas exploration as well. It is to be mentioned here that the minister made this announcement at the launch of the ninth new exploration licensing policy (Nelp-IX).

The government has invited bids for the exploration of 34 blocks in the plan.

On the move, Oil secretary S Sundareshan said that the new tax regime will be based on the direct tax code and will replace the existing income tax laws from 2012.

The Oil secretary further mentioned that the change will not at all impact the Nelp-IX. As investors are looking for more clarity on the bid, there should not be many doubts left now after the investments are made.